Veresen Provides Business Outlook and Announces 2017 Guidance

“Veresen has delivered very strong operational and financial results over the course of 2016, with particularly impressive performance from Alliance,” said Don Althoff, President and CEO of Veresen. “We expect to sustain this momentum throughout 2017. We will continue to deliver on our strategy, with several key milestones in the coming year, including entering into an agreement for the sale of the power business in the first quarter and bringing the first two processing facilities currently under construction at Veresen Midstream into service towards the end of the year.”

2017 Budget Highlights:

Strong performance is expected to continue, underpinning a dividend that remains entirely supported by distributable cash generated from existing take-or-pay and fee-for-service contracts

Capital program of approximately $475 to $525 million to advance Veresen’s inventory of $1.3 billion of projects under construction, with the Tower and Sunrise processing facilities to be placed into service towards the end of the year

Remain fully funded, with no requirement to access equity or debt capital markets to finance projects currently under construction, supporting the company’s objective of growing distributable cash per share

Business Outlook

The strong performance from the business in 2016 is expected to be sustained through 2017. A wide AECO – Chicago gas price basis differential as well as constraints on alternative egress options out of western Canada are expected to continue to drive strong demand for Alliance’s service over the coming year. Alliance has begun working with shippers to extend firm capacity contract length beyond the current average of four years to capture the value of its ability to transport liquids-rich natural gas to the premium Chicago market and to provide greater long-term visibility for the business.

Veresen Midstream, Ruby and AEGS will also continue to provide steady sources of cash flow in 2017 through their fixed distributions. Within Veresen Midstream, cash flows under the existing take-or-pay agreement at Hythe/Steeprock and throughput volumes at existing Dawson gathering and compression facilities are expected to remain consistent year over year.

The company expects throughput volumes on Ruby to remain well below contracted amounts of approximately 1.1 bcf/d as a result of AECO’s competitiveness into Malin Hub relative to sourcing from Opal Hub. Veresen remains confident that investment grade shippers on Ruby represent sufficient volumes to meet Veresen’s preferred distribution.

The company expects NGL margins to improve slightly, which would result in a modest contribution from Aux Sable in 2017. Aux Sable’s NGL Sales Agreement with BP provides the opportunity to benefit from a recovery in NGL margins, while continuing to provide downside protection.

Capital Program

Veresen remains positioned for meaningful near term growth with an inventory of over $1.3 billion of projects under construction that are expected to generate an incremental $135 to $160 million of annual run-rate EBITDA net to Veresen. The company will continue to advance these projects in 2017 through a capital program of approximately $475 to $525 million, with approximately 95% of the investment at Veresen Midstream.

A significant portion of the capital at Veresen Midstream will be used to advance the construction of the three processing facilities sanctioned to date, with the Tower and Sunrise processing facilities expected to be in service towards the end of 2017. In aggregate, the Tower and Sunrise facilities will add 600 mmcf/d of processing capacity, more than doubling Veresen Midstream’s existing capacity. Following an initial ramp-up period, these two facilities are expected to generate combined annual run-rate EBITDA of $75 to $95 million net to Veresen. The Saturn Phase II processing facility is expected to be in service in mid-2018.

Veresen Midstream anticipates that additional capital projects will be sanctioned in the near term by Cutbank Ridge Partnership and Encana given the need for increased liquids-rich gas handling and processing capacity.

Veresen will advance the construction of the Burstall ethane storage project in 2017 with $20 to $30 million of capital investment anticipated through the year. The company expects Burstall will be in service by late 2018, generating over $15 million in EBITDA on an annual basis.

Jordan Cove LNG Project and Pacific Connector

Veresen will continue to advance the Jordan Cove LNG export terminal and Pacific Connector natural gas pipeline, with Veresen’s Board of Directors having approved a 2017 project development budget of approximately US$30 million. The focus will remain on securing additional agreements for the long-term sale of natural gas liquefaction capacity at the export terminal as well as obtaining the requisite regulatory permits for both the terminal and the pipeline. The project development budget will continue to be reviewed by Veresen’s Board of Directors throughout the year to ensure that project development spend is tied to progress on commercial and regulatory milestones.

Balance Sheet and Funding Strategy

The company remains in a strong financial position to execute its 2017 capital program, with a clear strategy in place to fully fund the projects currently under construction without accessing the capital markets. As part of this strategy, an additional $650 million of new credit facilities were put in place within Veresen Midstream in September. In November, Veresen issued $350 million in senior unsecured medium term notes to facilitate the repayment of $300 million in senior unsecured medium term notes that mature in March 2017.

The process to divest the power business is advancing, and Veresen continues to expect to enter into binding sale agreements in the first quarter of 2017, with the divestiture closing in the first half of the year. Proceeds from the sale will initially be directed to repay debt outstanding on the revolving credit facility and will subsequently be used to fully fund the equity component of the growth capital program, including equity contributions of $325 to $375 million into Veresen Midstream in 2017.

2017 Guidance

Veresen expects distributable cash in 2017 to be in the range of $1.00 to $1.14 per common share, assuming a sale of the power business at the end of the second quarter. Based on an annualized dividend of $1.00 per common share, the corresponding payout ratio would range from 88% to 100%. Importantly, Veresen expects the dividend will remain fully supported by distributable cash from its take-or-pay and fee-for-service businesses.

Veresen reaffirmed its 2016 distributable cash guidance of $1.12 per common share to $1.16 per common share. Further details concerning both 2016 and 2017 guidance can be found on the home page of Veresen’s web site at www.vereseninc.com.

Advisories & Contact

Conference Call & Webcast Details

A conference call and webcast presentation will be held to discuss the 2017 guidance release at 7:00am Mountain Time (9:00am Eastern Time) on Monday, December 5, 2016.

To listen to the conference call, please dial 647-788-4919 or 1-877-291-4570 (toll-free). This call will also be broadcast live on the Internet and may be accessed directly at the following URL:

A presentation will accompany the conference call and will be available via the webcast. Alternatively, the presentation will be made available immediately prior to the conference call start time of 7:00am Mountain Time on Veresen’s website at: http://www.vereseninc.com/invest/events-presentations.

A digital recording will be available for replay two hours after the call’s completion, and will remain available until December 23, 2016 21:59 Mountain Time (23:59 Eastern Time). To listen to the replay, please dial 416-621-4642 or 1-800-585-8367 (toll-free) and enter Conference ID 17289029. A digital recording will also be available for replay on the company’s website.

About Veresen Inc.

Veresen is a publicly-traded dividend paying corporation based in Calgary, Alberta that owns and operates energy infrastructure assets across North America. Veresen is engaged in three principal businesses: a pipeline transportation business comprised of interests in the Alliance Pipeline, the Ruby Pipeline and the Alberta Ethane Gathering System; a midstream business which includes a partnership interest in Veresen Midstream Limited Partnership, which owns assets in western Canada, and an ownership interest in Aux Sable, which owns a world-class natural gas liquids (NGL) extraction facility near Chicago, and other natural gas and NGL processing energy infrastructure; and a power business comprised of a portfolio of assets in Canada. Veresen is also developing Jordan Cove LNG, a six million tonne per annum natural gas liquefaction facility proposed to be constructed in Coos Bay, Oregon, and the associated Pacific Connector Gas Pipeline. In the normal course of business, Veresen regularly evaluates and pursues acquisition and development opportunities.

Certain information contained herein relating to, but not limited to, Veresen and its businesses and the offering of the notes, constitutes forward-looking information under applicable securities laws. All statements, other than statements of historical fact, which address activities, events or developments that Veresen expects or anticipates may or will occur in the future, are forward-looking information. Forward-looking information typically contains statements with words such as “may”, “estimate”, “anticipate”, “believe”, “expect”, “plan”, “intend”, “target”, “project”, “forecast” or similar words suggesting future outcomes or outlook. Forward-looking statements in this news release include, but are not limited to, statements with respect to: the performance of Veresen’s businesses in 2016 and 2017; the timing of from the sale of Veresen’s power business; in service dates and cost of construction of, and amount of EBITDA to be generated by, the Sunrise and Tower gas plants; the ability of Veresen, and sources of equity and debt financing required, to fund projects under construction; the outlook for AECO – Chicago gas price basis differential and egress options out of western Canada; the demand for services on Alliance; the financial and operating results of Veresen Midstream; volumes of gas on Ruby pipeline and the creditworthiness of shippers on Ruby; the outlook for NGL margins; the amount of EBITDA to be contributed by, and the capital costs of, projects under construction; the in service date of the Saturn Phase II processing facility; capital projects to be sanctioned by Veresen Midstream in 2016; the in service date and cost of construction of the Burstall ethane storage facility; project development spending for Jordan Cove LNG and Pacific Connector; the use of proceeds from the sale of Veresen’s power business; the funding plan of Veresen; and the amount of distributable cash to be generated by Veresen in 2016 and 2017. Readers are also cautioned that such additional information is not exhaustive. The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty as these factors are independent and management’s future course of action would depend on its assessment of all information at that time. Although Veresen believes that the expectations conveyed by the forward-looking information are reasonable based on information available on the date of preparation, no assurances can be given as to future results, levels of activity and achievements. Undue reliance should not be placed on the information contained herein, as actual results achieved will vary from the information provided herein and the variations may be material. Veresen makes no representation that actual results achieved will be the same in whole or in part as those set out in the forward-looking information. Furthermore, the forward-looking statements contained herein are made as of the date hereof, and Veresen does not undertake any obligation to update publicly or to revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable laws. Any forward-looking information contained herein is expressly qualified by this cautionary statement.

Certain financial information contained in this news release may not be standard measures under Generally Accepted Accounting Principles (“GAAP”) in the United States and may not be comparable to similar measures presented by other entities. These measures are considered to be important measures used by the investment community and should be used to supplement other performance measures prepared in accordance with GAAP in the United States. US GAAP requires us to equity account for our investments in jointly-controlled businesses. However, we have chosen to provide some information on our jointly-controlled businesses on a proportionate basis to assist the reader. For further information on other non-GAAP financial measures used by Veresen see Management’s Discussion and Analysis, in particular, the section entitled “Non-GAAP Financial Measures” contained in the annual Management Discussion and Analysis, filed by Veresen with Canadian securities regulators.